P Honorable IsaacM. Castro Stonewall County Attorney P.O.Box 396 Aspermont, Texas 79502 Opinion NO. J?i-828

Re: Whether common-law incompatibility prohibits a particular individual from serving on the board of directors of a hospital district (RQ-1116)

DearMr. Castro:

You seek an Attorney General Opinion answering the following question:

May a person serve asa member of the board of directors of a public hospital district andbe simultaneously employed by a physician who receives part ofhis income from thehospital district?

Your question concerns the Board of Directors for the Stonewall Memorial Hospital District which oversees the operation of thehospital and aclinic. YOU state that a newly elected board member isemployed inthe clinic as abookkeeper and receptionist by the sole physician practicing in the district's facilities. She has been employed inthat capacity forapproximately ten years by the various physicians who have contracted with the district topractice medicine in the clinic andhospital.

The contract between thedistrict and the physician guarantees him anet income of $8,000 per month. The board member's salary as bookkeeper is physician but isconsidered an expense paid by the forpurposes of determining his actual net income. If his actual net income is less than $8,000 thehospital him thebalance. district must pay Eachmonth, theboard ofdirectors votes to approve his expenses, including the board member's salary as receptionist andbookkeeper. YOU suggest that the common-law doctrine of incompatibility prevents this individual from serving inboth positions.



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The common-law doctrine of incompatibility prevents
one person fromholding two offices if the duties are inconsistent or inconflict, or if one office is subordinate to the other. Thomas v. Abernathv Countv Line Indevendent School District, 290 S.W. 152 (Tex. Comm'n APP. 1927, judgm't adopted). In Thomas v. Abernathy Countv Line Indenendent School District, the court held that acity alderman could not also serve as trustee of a school district, where the incorporated townwas within the boundaries of the school district. The court found the two offices to be incompatible because both theboard of aldermen and theboard of trustees had directory and supervisory powers over school property located within the city limits. There might arise aconflict between the two officers about the appropriate health, sanitation, and fireprevention standards to apply to school property. But see State v. Martin, 51 S.W.2d 815 (Tex.Civ. APP. - SanAntonio 1932, nowrit) (school trustee may serve as city tax collector because the duties of office are unrelated and neither officer is accountable to the other).

The incompatibility rule also bars a public employee fromholding a public office which appoints, supervises and controls his employment. See Ehlinaer v. Clark, 8 S.W.2d 666 (Tex. 1928);Attorney General Opinion JM-203 (1984):Attorney General Letter Advisory No. 114 (1975). Whether two offices are incompatible may be determined by comparing their powers andduties, in some cases in the context of the geographical jurisdiction of each. Incompatibility between an office and an employment depends primarily on the employee's subordination or accountability to the officer.

The Stonewall County District was established pursuant to anuncodified special lawadopted in 1963. H.B. No. 295,Acts 1963, 58thLeg., ch. 54,at 89;M V.T.C.S. a*. 4494q (listofhospital districts created by special act). The 1963 lawwas adopted pursuant to the legislature's constitutional authority to create hospital districts composed ofone ormore counties. Comnare Tex. Const. art. IX, 59 (authorizing legislature to create county hospital districts) with Tex. Const. art. III, 556 (limitation on enactment of local and special laws except
asotherwise provided inconstitution). House Bill No. 295provides that the management and control of the hospital district isvested in theboard ofdirectors and

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P

-. grants theboard other powers ofoffice. See U.S. No. 295,

§53-7, suvra. The board

shall have thepower toprescribe themethod andmanner ofmaking purchases and expenditures by and for such Hospital District, and also shall prescribe all accounting and control procedures; themethod ofpurchasing necessary supplies, materials and equipment; and shall have the power to adopt a seal for such District: andmav emdov a aeneral

manaaer. attorney. bookkeener. architect, and anv other emdovees deemed necessary for the efficient overation of the HOSDital District. (Emphasis added.)

Acts 1963, 58th Leg., ch. 54, !i7, at 92-93. Thus, the authority tohire employees of thehospital district is vested inthe board ofdirectors, even though the board has apparently allowed the physician with whom it contracts to employ thebookkeeper-receptionist, orhas at least considered her to be his employee. The board holds ultimate authority over the employment of the bookkeeper-receptionist and exercises supervision and control by approving her salary aspart of thephysician's expenses.

Inour opinion, the office ofdirector of the Stonewall Memorial Hospital District is incompatible with the employment as bookkeeper-receptionist in the district's clinic. The board has ultimate authority over the board member’s employment in the clinic. The boardts contract with the physician will eventually be subject to renewal andmay become a subject of controversy between the physician and the board. The board may have to make decisions which would affect the operation of the clinic where theboard member works. The employee ispresently accountable to the board on which she serves for her salary. Thus, theboard's power to manage the district's facilities and to employ its personnel creates a considerable area of conflict between the office of director and the employment as bookkeeper and receptionist in the clinic. The relationship of supervisor and subordinate which exists between the board of directors of the hospital district and the bookkeeper-receptionist of the clinic renders the two positions incompatible. Upon election to the board, the individual should have relinquished the incompatible employment. &g Letter Advisory No. 114 (1975).

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SUMMARY

The common-law doctrine of incompatibility bars oneperson from serving as a member of the board of directors of the Stonewall Memorial Hospital District and at the same time being employed in the district's clinic by the doctor under contract with thedistrict.

JIM MATTOX Attorney General of Texas

MARY KELLER Executive Assistant Attorney General

JUDGE ZOLLIE STEAKIXY Special Assistant Attorney General

RICK GILPIN Chairman, Opinion Committee

Prepared by Susan L. Garrison Assistant Attorney General

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